Most people do not realize that when they are injured in a car accident or most accidents for that matter, there are various medical lien personal injury settlement that attorneys are legally obligated to pay out of your settlement or jury verdict.
Most people carry health insurance or Medicaid and if your health insurance company pays any of your medical bills from your car accident, then they have a “lien”, medical lien personal injury settlement on your case. In other words, a medical lien is something you have to pay to a company that has paid out medical bills on your behalf.
FEDERAL AND/OR STATE LAW GOVERN MEDICAL LIEN PERSONAL INJURY SETTLEMENT
Let’s say that you have Blue/Cross Blue Shield or Anthem as your health insurance company. A lot of these medical liens are governed by ERISA which is a federal law/statute that allows Anthem to recover back what they paid out in medical bills if you recover a medical lien personal injury settlement, such as in a car accident. For example, Anthem pays your chiropractor $1,000. Anthem would have a medical lien personal injury settlement on your car accident settlement. So, if you recover $10,000, then $1,000 of that $10,000 has to be paid back to Anthem pursuant to ERISA law.
EXAMPLE OF COLORADO LAW IN A MEDICAL LIEN PERSONAL INJURY SETTLEMENT
An example of a state governed medical lien in Colorado are hospital bills. In Colorado, hospitals have a priority lien on your settlement money. If you were not injured in a car accident or did not recover a medical lien personal injury settlement, then you will not have to pay back the hospital. But, if you do recover a settlement against an at-fault driver, then the hospital that treated you has a lien against your settlement. Colorado Revised Statutes, section 38-27-101.
Here is the actual Colorado statute/law governing hospital medical liens:
(1) Before a lien is created, every hospital duly licensed by the department of public health and environment, pursuant to part 1 of article 3 of title 25, C.R.S., which furnishes services to any person injured as the result of the negligence or other wrongful acts of another person and not covered by the provisions of the “Workers’ Compensation Act of Colorado”, articles 40 to 47 of title 8, C.R.S., shall submit all reasonable and necessary charges for hospital care or other services for payment to the property and casualty insurer and the primary medical payer of benefits available to and identified by or on behalf of the injured person, in the same manner as used by the hospital for patients who are not injured as the result of the negligence or wrongful acts of another person, to the extent permitted by state and federal law.
(2) If no payers of benefits are identified for the injured person due to lack of insurance, a lien may be created.
(3) If a hospital is notified of a payer of benefits after it creates a lien, the hospital shall make good-faith attempts to submit reasonable and necessary charges for hospital care or other services to the identified payer in the same manner as used by the hospital for patients who are not injured as the result of the negligence or wrongful acts of another person.
(4) After a hospital satisfies the requirements of this section, and subject to this article, the hospital shall have a lien for all reasonable and necessary charges for hospital care upon the net amount payable to the injured person or to his or her heirs, assigns, or legal representatives out of the total amount of any recovery or sum had or collected, or to be collected, whether by judgment, settlement, or compromise, by the person or his or her heirs or legal representatives as damages on account of the injuries.
(6) Nothing in this section changes any obligation of the hospital or its agents under the “Colorado Medical Assistance Act”, articles 4 to 6 of title 25.5, C.R.S.
(7) An injured person who is subject to a lien in violation of this section may bring an action in a district court to recover two times the amount of the lien attempted to be asserted.
(8) The lien of attorneys- and counselors-at-law created by section 13-93-114 has precedence over and is senior to the lien created under this section. This article 27 does not apply to any hospital charges incurred after the date of any such judgment, settlement, or compromise.
(9) For purposes of this section, “payer of benefits” means:
(a) An insurer;
(b) A health maintenance organization;
(c) A health benefit plan;
(d) A preferred provider organization;
(e) An employee benefit plan;
(f) A program of medical assistance under the “Colorado Medical Assistance Act”, articles 4 to 6 of title 25.5, C.R.S.;
(g) The children’s basic health plan, article 8 of title 25.5, C.R.S.;
(h) Any other insurance policy or plan; or
(i) Any other benefit available as a result of a contract entered into and paid for by or on behalf of an injured person.
You or your personal injury lawyer cannot ignore a medical lien personal injury settlement. If you decide to ignore the medical lien personal injury settlement, then the hospital or your health insurance company can take you to court to recover their money. Your health insurance company can also take your car accident lawyer to court as well as your car accident lawyer does have a legal and ethical obligation to honor all liens out of a medical lien personal injury settlement.
WHAT CAN YOUR CAR ACCIDENT ATTORNEY DO ABOUT MEDICAL LIEN PERSONAL INJURY SETTLEMENT?
In some cases, a good attorney can negotiate these liens and pay back less than the total lien, thus putting a little more money in your pocket. Again, a medical lien personal injury settlement is very dangerous and if you ignore them, you can be sued in court. Also, as stated above, your car accident attorney has an ethical and legal obligation to search and pay back all liens on your case.
A GOOD CAR ACCIDENT ATTORNEY WILL:
*Check all your medical bills to see if there are liens on your settlement money
*If you went to the hospital, your car accident attorney will check your hospital bill and see if it has been properly recorded as a hospital lien
*A good personal injury attorney will honor any written liens that you may have signed and agreed to in order to get medical treatment.
*Your car accident attorney can check all the liens in your case and make sure they were properly billed and that there are no excess charges
*A good car accident attorney will call each and every health care provider and get an accurate balance as to what is owed to each health care provider
*A good car accident attorney will make sure each and every lien is valid and will try to negotiate the lien in order that you receive more money in your eventual medical lien personal injury settlement
*A good car accident attorney will check for any and all Medicaid and/or Medicare liens which are federal liens on your medical lien personal injury settlement
*A good car accident attorney will make sure that all of your medical lien personal injury settlement are taken care of out of your settlement so that you promptly receive your net settlement amount
A MEDICAL LIEN PERSONAL INJURY SETTLEMENT IS SIMILAR TO A CONTRACTOR WHO DOES WORK ON YOUR HOUSE
If you hire a contractor to do work on your house, and you do not pay this contractor, then he will have a lien and will file a lien against your property with the proper agency in your city. This lien, if not paid, will gather interest and start to increase as time passes by. If you try to sell your house without paying this contractor lien, then it will not be possible to sell your house. This contractor lien is recorded and in order to sell your house, you must pay the lien in full or negotiate the lien. If not, then any potential buyer cannot get clear title to your house and you will be unable to properly sell your house.
The same principle is true with regards to medical lien personal injury settlement. If you or your car accident attorney do not honor and pay the medical liens out of your settlement money, then the insurance company will not agree to write you a settlement check for your car accident.
LETTERS OF PROTECTION FOR A MEDICAL LIEN PERSONAL INJURY SETTLEMENT
A lot of doctors, health care providers, MRI facilities, physical therapists, etc. will accept what is called a “letter of protection” from your car accident attorney. A good car accident attorney will draft and sign a letter of protection so that you can treat with a health care provider or have an MRI, for example. This is done in situations where you may not have any insurance or med pay insurance to cover your medical bills. If you have no insurance to cover your medical bills, then your car accident attorney can send this letter of protection to your treating doctor. Your treating doctor will use this letter so that he gets paid out of your medical lien personal injury settlement.
This is to your benefit because your doctor will wait to be paid until your case settles. Without lien rights, your doctor would make you pay upon each visit and this could be expensive to you and you may not be financially able to pay $150 per visit or whatever your doctor charges per visit. This way, with a letter of protection on a medical lien personal injury settlement, will allow your treating doctor to only charge you you’re your case is finished and settled. Again, your car accident attorney is legally obligated to pay your doctor and medical bills out of your medical lien personal injury settlement money.
Hopefully, this article adequately explains “medical liens” and how they work in a car accident case. If you have any questions, please contact me and I would be more than happy to answer any type of question involving this very important topic.